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Liability of the MTO

4. Basis of liability: The MTO is liable for any loss of, damage to, or delay in delivery of, the consignment as well as any consequential loss or damage arising from such delay, if such loss, damage or delay took place while the goods were in his charge. The MTO, however, is not to be liable if he proves that no fault or neglect on his part or that of his servants and agents, had caused or contributed to such loss, damage or delay in delivery (section 13 (1)). While it is evident from the provision of section 13 (1) that the MTO is liable for loss, damage or delay while the goods are in his charge, there is no provision specifically setting out period of responsibility of the MTO. 5. Localized damage: Provisions of section 13 (1) seem to govern the liability of the MTO both in cases of localized and non-localized damage, since the section 15 of the Act makes only the limits of liability of the MTO subject to the relevant law applicable to the stage of transport during which the loss or damage is known to have occurred (i.e. modified network system). 6. Delay in delivery: Similar to the UNCTAD/ICC Rules, the MTO is only liable for loss or damage arising from delay if the consignor has made a declaration of interest in timely delivery, which had been accepted by the MTO (section 13 (1)). The definition of delay in delivery is provided by way of explanation to the relevant section of the Act, that is section 13 (1). The claimant may treat the consignment as lost if it has not been delivered within ninety consecutive days following the date expressly agreed for delivery or the date it should have been reasonably expected to be delivered. 7. Limitation in liability: Provisions dealing with the limitation of liability of the MTO for loss, damage or delay is based on the UNCTAD/ICC Rules. Thus, the MTOs liability is limited to 2 SDR per kilogram of the gross weight of the consignment lost or damaged, or 666.67 SDR per package or unit, whichever is the

higher. And if according to the MT contract, no carriage by sea or by inland waterways is involved, the liability limit is increased to 8.33 SDR per kilogram of the goods lost or damaged (section 14 (1) (2)). 8. In case of localized damage, unless the nature and value of the goods have been declared before they have been taken in charge by the MTO, the limit of liability of the MTO for loss or damage will be determined in accordance with the provisions - 9 of the relevant laws applicable to the mode of transport during which the loss or damage occurred. Any stipulation to the contrary in the MT contract shall be void and unenforceable. 9. The MTOs liability for delay in delivery and any consequential loss or damage arising from such delay, is limited to the freight payable for the delayed consignment (section 16). Similarly provisions dealing with the assessment of compensation for loss or damage, loss of right to limit liability, the aggregate liability of the MTO and notice of loss or damage to goods, are based on those of the UNCTAD/ICC Rules. 1